Bloch slams corruption in government

By Lance Guma
18 November 2005

Leading Zimbabwean economist Erich Bloch has singled out corruption in both the private and public sector as one of the biggest causes of the country’s economic problems. He was commenting on admissions by Finance Minister Herbert Murerwa that price controls have contributed to the current hyper-inflationary environment. Bloch believes however this is only part of the problem and there is a need to tackle corruption which has seen the country listed amongst the 30 most corrupt countries in the world.

In an interview with Newsreel Bloch said price controls in any event have never worked anywhere in the world. Controls make it unprofitable for manufacturers to produce and sell goods. This is what has created shortages which in turn have fuelled a black market dominated by high prices. He urged the government to spend money which it had and not that which it intends to borrow. He revealed that in the first nine months of the year government borrowings had grown by 1078 percent and that this was fuelling money supply growth and ultimately inflation.

Bloch also stressed the need for a marked increase in productivity and said the Agriculture sector needed to be restructured in order for it to contribute towards rebuilding the economy as it once did. He conceded politicians in Zimbabwe don’t want their political objectives to be over-ridden by economic considerations and that this is contributing to the current problems. Meanwhile Finance Minister, Herbert Murerwa told a pre-budget consultative meeting that market forces were now destined to play a bigger role in the 2006 budget. Cynics however say this might be one of the conditions for a bail out loan from South Africa.